A new market for B.C.’s price-depressed natural gas industry could open up in the near future if the provincial government listens to the BC Ferry Commission.
On Tuesday, ferry commissioner Gordon Macatee released a much-awaited review of BC Ferries’ financial state and operations, recommending, among other things, that the semi-independent organization start using liquefied natural gas (LNG) to fuel its vessels.
The change from diesel-powered vessels could save the organization as much as $28 million per year, according to Macatee.
“The Commission is not qualified to judge the suitability of LNG technology on vessels,” Macatee wrote in his Coastal Ferry Act review. “We simply note that if LNG can provide long-term savings and greater certainty about fuel costs, it merits serious consideration.”
The report did not say how much the changeover would cost, only that it would take several years to complete and would likely have a five-year payback period.
The recommendation comes as the province’s $6 billion natural gas industry is struggling to find markets for its product.
Macatee’s recommendation is not the first time that LNG has been proposed as a possible cost-savings tool for BC Ferries, which is struggling with growing losses amid multi-decade lows in passenger and vehicle counts.
Macatee’s report contained 24 recommendations for government that it believes would help the struggling organization wipe the red ink from its balance sheet.
Those recommendations included:
- That future price increases should be held to the rate of inflation;
- That the commission should have more explicit authority to hold the operator accountable;
- An increase in oversight for capital plans and acquisitions
- Increased financial support for the ferry system from the provincial government; and
- An upgraded reservation-system for ferry users, among other things.
Transportation Minister Blair Lekstrom said he had received Macatee’s report, and would discuss its recommendations with cabinet members in the coming weeks.
“I think everything is on the table right now, but I want to be very clear ... I’m not prepared at this moment to make a determination on any of those recommendations,” Lekstrom said on a conference call.
Last month, the minister rejected a BC Ferries proposal to cut up to 400 round trip sailings per year for a cost savings of $2.7 million (see “Province rejects BC Ferries' proposal to reduce sailings.”)
Joel McKay